Health insurance products to have greater choices

State-owned general insurance companies are planning to introduce health insurance products, designed to suit the need of different consumer groups.

"It is evolving towards designing policies based on abilities of consumers," National Insurance Company (NIC) director A V Girija Kumar told reporters on the sidelines of a seminar organised by Indian Chamber of Commerce on alternate dispute resolution.

In other words, the premium will be more for hospitalisation benefits with higher level of facilities than traditional health policies.

The development comes after controversy over excess billing by private sector hospitals in cashless system.
The public sector insurance companies are also looking at setting up ailment-wise health insurance packages, sources said.

"We are looking at whether a disease-wise limit could be taken up if possible separate products can be designed over a period of time. If somebody prefers expensive hospitals, he would necessarily have to have to bear a higher costs (of insurance policy)," Kumar said.

Billing was much higher for those availing cashless facility than those who did not. This led to large claims ratio for the insurance companies.

"It is not that cash-less facility has been withdrawn, it is only some kind of restructuring that is taking place keeping in mind the larger interest of the consumers," Kumar said.

For life insurers, Aug 31 will have 384 hours

For private life insurers, Aug 31 could be the longest working day this fiscal as they scurry to book unit-linked policies (ULIPs) sold long after the deadline set by the regulator. 

The insurers would theoretically add a whopping 384 hours to Aug 31, booking unit-linked policies sold till 15 days after a deadline set by the reguator -- a practice such companies follow every fiscal end (March 31).

'At the time of closing of annual account, insurers used to work throughout the night and even the next two days to book the policies sold on or before March 31. But whether the life insurers would be able to do that for 15 days is doubtful,' S.B.Mathur, secretary general, Life Insurance Council of India (LIC), told IANS. 

However, he agreed that many private life insurers are apprehensive as to whether they will be having any ULIP at all to sell on Sept 1. 

'We have no clue whether we will be having any unit linked insurance policy (ULIP) at all to sell from Sept 1 onwards. We have filed our products for approvals with IRDA (Insurance Regulatory and Development Authority),' a senior official of a private life insurer told IANS on the condition of anonymity.

According to him, insurers should get IRDA's sanction for products at least by Aug 27 so that sales can take place from Sept 1 onwards. 

'If that does not happen then life insurers will be selling the old products even till Sept 15 and back date them in their books. Incidentally that is what is being planned by insurers,' he said.

Said another industry expert: 'I have known cases where policies were booked even after 15 days after the annual closure of books. I wonder how insurers would give Aug 31 NAV (net asset value) on policies sold after that date.' 

Responding to the industry's apprehension on delayed product approval, a senior IRDA official on the condition of anonymity told IANS: 'Our actuarial team is working on the product approval process for nearly 18 hours a day. If life insurers had designed their products as per our guidelines then we can issue the sanction in one day itself.' 

He said more than 60 ULIP products have been filed with IRDA for approval during the last two days and the officials are looking at these in detail. 

According to industry circles, the quality of product filings confirming to the regulations this time around is poor as compared to other times.  

Refuting the industry's complaint that IRDA has not clarified the doubts raised about the new ULIP regulations by the actuaries, the IRDA official said: 'All the points that have been raised by the actuaries have been answered point-wise.' 

For the private life insurers, Sept 1 is not like any other day though many think so, said an industry official.

'Sept 1 is the day when the industry is being reset on proper path. It is as if somebody pressing the reset button in a computer. This many life insurance CEOs are not realizing. They are planning to go back to the past acts,' he said. 

He said many life insurers are planning to offer as high as 80 percent commission on traditional products to keep the corporate agents happy. 

'Catching their act will be difficult. It will be the policyholders who will suffer in terms of low bonus rates,' he added.